House passes another SBIR funding stopgap

Published: September 30, 2010

Congress has once again voted to provide temporary funding for U.S. Small Business Administration programs, including the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs, this time through Jan. 31, 2011.In the ninth continuing resolution backing a short-term stopgap funding measure, the House voted to approve S. 3839, extending the SBIR programs, which would have had sunsetted on Sept. 30. But a long-term compromise remains elusive.In fact, analysts on Capitol Hill say it is doubtful now that such a bill will be passed, or even voted on, by the end of the year.The major sticking point between the small-business committees in the House and the Senate appears to be how much control venture capitalists should or should not have in awardee companies.“One side is supporting up to 51 percent ownership by VCs, the other side wants something less,” said Hollis McGuire, director of the Nashua office of New Hampshire’s Small Business Development Center and a founding member of the venture group Northeast Angels. “Another issue is the size of the awards. Some want them capped, others do not.”Currently, awards can run as high as $750,000 to individual businesses meeting specific criteria.In 2009, New Hampshire businesses and organizations were awarded some $21 million in grants. Companies such as Concord-based carbon nanotube developers Nanocomp Technologies, Durham defense contractor ArgenTech Solutions and Creare Inc., a Hanover-based firm focused on new applications in fluid dynamics, have been past recipients, along with dozens of others in the Granite State.Another interesting development has been occurring in the background – the creation of the SBIR 2.0 program.The U.S. Small Business Administration calls it a “a new and improved SBIR,” with a goal of getting funds to awardees within 60 days.Currently, SBIR 2.0 is focusing on Phase II awards funded through four federal agencies – the National Institute of Standards and Technology, the U.S. Navy, the National Institutes of Health and the Department of Transportation – providing as much as $40 million, or up to $100 million in matching funds.One active program under SBIR 2.0 is a joint SBIR Phase I solicitation for robotics by the National Institutes of Health, Department of Homeland Security, Defense Advanced Research Projects Agency (DARPA), National Science Foundation and USDA.Proposals for this grant are due by Dec. 20.“I don’t think SBIR 2.0 is meant to replace SBIR, but to augment the current program,” said McGuire. “It’s focused on robotics and fast-tracking those projects.”But if another reauthorization does not come through in January, SBIR 2.0 would also be in peril.But despite the uncertainty of the program’s future, companies are "not being deterred" from applying,” said McGuire. “They’re moving forward.”Eleven federal agencies – including the Department of Defense and National Science Foundation — participate in the SBIR, STTR and related programs. – CINDY KIBBE/NEW HAMPSHIRE BUSINESS REVIEW